1. Legal Terms
unilateral mistake (p. 133)
bilateral mistake (p. 135)
duress (p. 137)
economic duress (p. 137)
undue influence (p. 138)

2. Section Outline Mistake Duress Undue Influence Unilateral Mistake
Bilateral Mistake
Duress
Undue Influence

3. Genuine Agreement
In addition to fraud and misrepresentation, mistake, duress, and undue influence can also create a defective agreement.

4. Pre-Learning Question
How can a mistake disrupt an agreement?

5. Mistake
People sometimes enter into contracts believing that certain information is true when it is actually not, or that information is not true when it really is.

6. Unilateral Mistake
A unilateral mistake is an error on the part of one of the parties to the contract.
Through words or actions, one party has created reasonable expectations on the part of the other party to the contract.

7. Unilateral Mistake
Those expectations should not be blocked because one of the parties has made an error, or mistake.
A person usually cannot avoid a contract because of such a mistake

8. Unilateral Mistake There are two types of unilateral mistakes.
Mistake as to the nature of the agreement
Mistake as to the identity of a party

9. Nature of the Agreement
Mistake as to the
Nature of the Agreement
People who sign an agreement are bound to it, even if they have not read it or are mistaken about what it says.

10. Mistake as to the Identity of a Party
If you make an offer by letter to one party, but the wrong person mistakenly receives the offer, the mistake may be cause to void the contract.

11. Mistake as to the Identity of a Party
If you make the same offer face-to-face with a person whose identity you have mistaken, your mistake as to the identity will not prevent a binding contract.

12. Remedies for Unilateral Mistakes
6.2
Remedies for Unilateral Mistakes
Unilateral Mistake
Type of Mistake
Remedy
Mistake as to the
nature of the
agreement.
identity of a party
Rescission will not
be granted.
Rescission may be
granted.

13. Bilateral Mistake
When both parties to a contract are mistaken about some important fact, this is called a bilateral mistake, or mutual mistake.
When this mistake occurs, either party may avoid the contract.

14. Bilateral Mistake There are two types of bilateral mistakes.
Mistake as to the possibility of performance
Mistake as to the subject matter

15. Possibility of Performance
Mistake as to the
Possibility of Performance
If both parties enter into a contract believing that the duties described in the agreement can be performed, when in fact, they cannot, either party may avoid the contract.

16. Remedies for Bilateral Mistakes
6.2
Remedies for Bilateral Mistakes
Bilateral Mistake
Type of Mistake
Remedy
Mistake as to
possibility of
performance.
Mistake as to the
subject matter.
Rescission will be
granted.

17. True or false—Both parties may avoid contracts involving unilateral and bilateral mistakes.

18. ANSWER
False

19. Pre-Learning Question
What do you think duress is?

20. Duress
Duress is overcoming a person’s will by use of force or threat of force or bodily harm.

21. Types of Duress
Physical duress is when actual physical violence is used to force a person to enter a contract.
Emotional duress is when the threat of physical force is used to force a person to enter a contract.

22. Types of Duress
Economic duress is when threats to a person’s business or professional reputation are used to force a party to enter a contract.

23. Pre-Learning Question
What do you think undue influence is?

24. Undue Influence
Undue influence occurs when a person uses unfair and improper persuasive pressure to force another person to enter into an agreement.

25. Undue Influence
Circumstances such as ill health, old age, and mental immaturity may put a person in a weaker position.

26. Elements of Undue Influence
6.2
Elements of Undue Influence
Element
Description
A dependency
relationship
One party in a
relationship is
dependent on the
other party.

27. Elements of Undue Influence
6.2
Elements of Undue Influence
Element
Description
Unfair or improper
pressure
The independent person
uses excessive pressure
to force the dependent
person to enter a
contract.

28. Elements of Undue Influence
6.2
Elements of Undue Influence
Element
Description
A beneficial contract
The contract benefits
the independent party
at the expense of the
dependent party.

29. Reviewing What You Learned
Section 6.2 Assessment
Reviewing What You Learned
What is the difference between unilateral and bilateral mistakes?

30. Reviewing What You Learned Answer
Section 6.2 Assessment
Reviewing What You Learned
Answer
Unilateral mistake: only one party is mistaken.
Bilateral mistake: both parties are mistaken.

31. Reviewing What You Learned
Section 6.2 Assessment
Reviewing What You Learned
What types of mistake will allow rescission of a contract?

32. Reviewing What You Learned Answer
Section 6.2 Assessment
Reviewing What You Learned
Answer
Mistake as to the identity of a party, mistake as to the possibility of performance, and mistake as to the subject matter may allow rescission of a contract.

33. Reviewing What You Learned
Section 6.2 Assessment
Reviewing What You Learned
What are the requirements of economic duress?

34. Reviewing What You Learned Answer
Section 6.2 Assessment
Reviewing What You Learned
Answer
Economic duress requires threats to a person’s business or income that cause the person to enter a contract without real consent.

35. Reviewing What You Learned
Section 6.2 Assessment
Reviewing What You Learned
What are the requirements of undue influence?

36. Reviewing What You Learned Answer
Section 6.2 Assessment
Reviewing What You Learned
Answer
Undue influence requires unfair and improper persuasive pressure exercised by one person in a relationship of trust with another person.

37. Critical Thinking Activity Types of Mistakes
Section 6.2 Assessment
Critical Thinking Activity
Types of Mistakes
Why is it important to be able to distinguish between unilateral and bilateral mistakes?

38. Critical Thinking Activity Answer Types of Mistakes
Section 6.2 Assessment
Critical Thinking Activity Answer
Types of Mistakes
Answers will vary but should recognize that understanding the differences between unilateral and bilateral mistakes will help you know your rights and remedies in a contract.

39. Legal Skills in Action Undue Influence
Section 6.2 Assessment
Legal Skills in Action
Undue Influence
Suppose that a close friend has sent you an message saying that she believes her grandfather was tricked into signing over all of his property to his live-in caretaker.

40. Legal Skills in Action Undue Influence
Section 6.2 Assessment
Legal Skills in Action
Undue Influence
Your friend asks for your advice. Write an reply to explain the elements she would have to prove to demonstrate that her grandfather signed over his property because of undue influence.

41. Legal Skills in Action Answer
Section 6.2 Assessment
Legal Skills in Action Answer
Undue Influence
Answers should include the three elements of undue influence: a dependency relationship, unfair or improper pressure, and a beneficial contract.

42. End of Section 6.2